Claiming VAT and cost on Invoices with wrong name

[Paul_Walters]

I have a supplier who is crucial to my business and provide a one of a kind service in my area for which I have found no alternatives. They are a cantankerous bunch though, especially the billing dept. I have moved from a Ltd to sole trader and the account is in the Ltd name, now dissolved. I need to keep using the account but they are insisting that they can't change the name on it to a sole trader. I suggested closing the account and creating a new one in my name but apparently they are 'not opening new accounts at the moment'. Meanwhile they are happy for me to keep using it..........

I'm really stuck with this one and can't seem to get through to them. So, the account is live and I can use it, it gets paid on time etc. but it has the name of a dissolved Ltd on the invoices. Everything else is the same.

Am I going to run into problems claiming Input VAT back from these invoices and also putting them in the books as costs? It's clear that the account is only being used for my sole trader business and I can prove this in some detail. Help!

I'm also wary that I am incurring costs to a dissolved company although I have explained this to them and they are happy to keep billing this way. It's all very odd. Should I just change the name on the invoices? Is this illegal in some way?

 

[kevin.doran]

It would be down to the discretion of the VAT inspector.

I would suggest keeping all correspondence from said supplier to back up your claim whilst continuing to put the bills through as normal.

As you say, there's a clear and concise explanation which is totally out of your control.

Does @lesvatadvice agree?

 

[john1989]

I would reclaim the VAT on the invoices.


I would keep documentation readily available of the exchange that you have had with the company where you have asked them to change the account details to your sole trader business.


I would ensure any payments that are made to the supplier are made from the sole trader bank account (i.e. nothing in cash or bank accounts in other names).

 

[Paul_Walters]

Thanks. All payments are made from the business account and I can prove use of all services paid for in that business if required.

 

[UK Contractor Accountant]

This from another poster on sister site AccountingWeb:

"I have a similar issue, but with many more invoices. We were trading as sole trader and then set up a limited company. We did not know that we had to change our details on all the invoices, assuming that the director's name was sufficient. Bills include ROYAL MAIL to the value of £2000 inc VAT, average weekly. Various freight services with total VAT of almost £35,000. We have been told that the VAT cannot be claimed on any the invoices that are not addressed to the exact company name (word to word).


The VAT man has requested a side-by-side analysis showing all the invoices that had been claimed for VAT, then all the invoices that are not in the company name, and all the invoices that are in the correct name. They will not allow the VAT to be claimed without the correct name.


We have notified the suppliers, they have changed the name for future invoices, but they cannot change previous invoices. It took ROYAL MAIL 4 weeks to change our account details after notifying them, so I have got an extra 4 invoices to answer for."

It's a gamble if you put them through or not!

 

[lesvatadvice]

This is an area that HMRC inspectors have been targeting. But, if the supplier refuses to change the name details, and you have email correspondence to that effect, you should claim the input tax.
HMRC have discretion to allow input tax in the absence of fully compliant invoices. And this is an obvious scenario where that discretion should be exercised.

 

[Karimbo]

email your supplier and inform them, a lot of them are completely unaware of this. majority of people do not check vat status on VIES. But I do this a lot on ebay purchases and they flout this all the time.

Incompletely information, wrong business name etc.